Technology stocks rise on sector's positive earnings outlook

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KUALA LUMPUR (March 13): Technology stocks rose at mid-morning on the premise of a positive outlook for the sector’s near term earnings, driven by the current weakness of the ringgit versus the US dollar.

At 10.46am, Unisem (M) Bhd rose 0.48% or one sen to RM2.11, Malaysian Pacific Industries Bhd added 0.64% or 4 sen to RM6.28 and Inari Amertron Bhd gained 0.30% or one sen to RM3.29.

RHB Research has maintained its “Buy” rating on Malaysian Pacific Industries Bhd (MPI) with a higher target price of RM7.69 (from RM6.96), noting that MPI’s share price had gone up by 15% since its 2QFY15 (June) results were released at end-January.

“We are maintaining our Buy call with our target price upgraded to RM7.69 from RM6.96 (15.8x FY16F P/E, 23% upside) as we roll forward our valuation to FY16 from CY15,” it said in a note today.

“This is because we continue to see strength in its near-term earnings, thanks to the current weakness of ringgit against the US dollar,” it said.